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Medical Device Tax: Stifling Innovation and Hurting Veterans

It should surprise no one that Obamacare contains numerous time bombs of illogical and destructive policy. One such policy, which has recently gained national attention, is the implementation of a 2.3% medical device tax. This tax applies to any and all medical devices, from crutches to high tech surgical equipment. Both Republicans and Democrats have called for a delay, or repeal of the tax, to no avail. Despite the bipartisan push, most recently by Congressman Erik Paulsen, the administration has failed to act, and now it may be too late; the first medical device tax deposits are due to the IRS in less than two weeks.

The tax, which is expected to raise $30 billion in new revenue, was forced through by the Obama administration, without debate or pause to examine the potential consequences. Industry experts estimate the tax has already cost 6,000 jobs and could potentially cost upwards of 40,000 in the future, due to the unprecedented increase in manufacturing cost. Furthermore, the implementation of an arbitrary tax on the medical industry will hurt innovation. Manufactures will undoubtedly be less inclined to invest resources toward research and take risks on prototypes when their profit margins are being slashed. Lower margins equate to less disposable income for product development, putting American corporations at a disadvantage globally.

Additionally, the medical device excise tax has the potential to hurt veterans and taxpayers alike. Wounded and retired veterans make up a large percentage of medical device users; the cost of these devices is often shared between the VA and the individual. Adding an additional 2.3 percent to the cost of medical equipment has the potential to disproportionally impact disabled veterans, many of whom live on fixed retirement or disability income. Risking veterans’ financial security while wasteful government programs hemorrhage resources is immoral and entirely irresponsible.

While it is probably too late to stall the implementation of the tax, there is a reasonable chance that legislation repealing the tax could pass. I spoke with Congressman Erik Paulsen’s staff, who indicated that the Congressman would be authoring a bill to do just that in the near future. While the medical device tax is a monotonous issue, certainly less exciting than the Presidents gun grab, it is important for us to remain vigilant. Federal regulations and tax policies such as this appear insignificant when taken alone, however we must remember the US Tax Code didn’t amass to 73,608 pages overnight, it is full of mindless taxes such at this. Encourage your legislators to support Congressman Paulsen's efforts at repeal, with enough targeted support we can save thousands of jobs and protect our status as a global leader in healthcare innovation.

This is just another example of this administrations' war on business . That it adversely affects wounded warriors is disgusting . These are the patriots that the Commander-in-Chief is sending around the world to protect our freedom . He should be ashamed .

Politicians in Baton Rouge are quickly trying to rush through a new, multi-million dollar internet tax hike that proponents are claiming will help crack down on internet crimes such as child pornography and fraud.TAKE ACTION! HB 569 will impose a $.15 per month fee on bills from internet service providers to fund a new “Internet Crimes Investigation Fund.” The bill recently passed the Louisiana House and will be heard in the Senate this week.Cracking down on crime, and particularly crimes involving children, is a noble cause indeed. But HB 569 is the wrong approach.Lawmakers supporting this legislation are rushing to a big-government solution, even without allowing state law enforcement agencies adequate time to evaluate what they truly need. No credible studies have been produced to justify the creation of this new fund and the tax increase it requires. At the same time more localized efforts to combat online crimes have enjoyed success by better utilizing existing resources. For example, the Northwest Louisiana Internet Crimes Against Children Task Force has been extremely successful while operating on about $150,000 to $200,000 a year and relying on cooperation from a host of local law enforcement and district attorney’s offices in the region. Legislators need to think innovatively and prioritize projects instead of simply looking to expand government on the backs of hard-working Louisiana taxpayers. The size of the proposed new Internet Crimes fund may seem modest at this point, but just creating it opens the door to a slippery-slope of new government spending. We’ve all seen how bureaucracies can so easily grow out-of-control and as well-intentioned as they might be, turn into government slush-funds with taxpayers on the hook. Don’t let politicians use the idea of keeping children safe to cram more big government down your throat. TAKE ACTION NOW before the Senate takes up HB 569 and tell them to oppose this new internet tax hike scheme!

Delaware is the latest state to jump on the tax hike bandwagon with a plan to raise taxes on cigarettes and alcohol to bridge a looming budget gap. These so-called “sin taxes” seem to be the first place politicians go for some quick cash anytime they can’t pay the bills. Take Action and urge your lawmakers to oppose tax hikes and pursue real long-term growth policies.A recent proposal would raise alcohol taxes by two cents per 12-ounce can of beer, three cents per 5-ounce serving of wine, and 15 cents per bottle of liquor. The state cigarette tax would see a $.45/pack hike.Delaware doesn’t need to go down the path of higher taxes that nickel-and-dime citizens. State legislators need only look up I-95 to New Jersey to see the effect cigarette tax hikes have on the budget. A Heartland Institute study shows that for two years running, the tax hikes have led to reduced revenues, not the millions the state was banking on. New Jersey was left with a still gaping budget hole and businesses were hurt as smokers turned to the Internet, Indian Reservations, and the black market for lower priced cigarettes. This is a common scenario when legislators go after a minority of citizens for the funding woes of a state. The picture is the same when you look at alcohol taxes. Raising those taxes hurts businesses as well. Already, the hospitality industry is bleeding jobs during this economic downturn. The last thing they need is higher taxes!Governor Markell is hoping these proposals bring in over $20 million, a drop in the bucket when Delaware is facing an $800 million gap for 2010. But looking at other states who have tried the same tax and spend schemes, that money won’t be there and taxpayers will be again left holding the bag – only now with a much bigger price tag. Take Action and tell your legislators to avoid these tax gimmicks altogether. Delaware has a great history of tax competition and economic liberty that has allowed that state to thrive. Keeping spending in check is a far better way to maintain long-term growth than going down the tax-hike road where other states have become stuck.

Settled science rarely is. Except to those with a vested policy interest in the debate. True to form, a recent diatribe by Michael F. Jacobson of the Center for Science in the Public Interest acknowledges none of the widely available data that conflict with his passionate crusade against table salt. However, to a debate that has endured for decades, Jacobson does bring a modern twist:

In comments to the Sacramento Bee late last week, Governor Arnold Schwarzenegger magnanimously agreed to consider a proposal to maybe discuss a flat tax rate on income in California. Much like similarly surprising talk of ending marijuana prohibition, the news makes for great headlines, but taxpayers should avoid any real optimism for the time being.While Schwarzenegger cleverly pays lip service to what some consider the holy grail of tax code reform, at a suggested flat rate of 15 percent, he has actually proposed a massive tax increase. Currently, even the wealthiest Californians pay “only” 9.3 percent. In the seven states where a flat tax is already in effect, the average rate is just 4.1 percent.

Like something out of a horror film, the New York soda tax that won’t die is once again rearing its ugly head. It looks like Albany lawmakers are trying to take a few pages from the Obama-Pelosi-Reid playbook to pay for their pet projects with so-called “sin taxes.” Or maybe it was Governor Patterson’s earlier plan that inspired the federal soda tax plan? Well, no matter who started it – it’s a bad plan.Take Action and tell your elected officials they can’t nickel and dime New York taxpayers this way.Instead of doing the right thing by cutting spending, state lawmakers have proposed this new tax on non-diet soda to fund property tax relief. What soda has to do with property taxes remains to be seen, but this is a prime example of government efforts to redistribute money and subsidize one favored program or group on the backs of others. Governor Paterson and other state legislators have acknowledged that New York state, like many others across the country, is facing a massive budget deficit. To most households that would mean cutting back, tightening some belts, and spending less. That’s why it’s hard to understand why Paterson has proposed a budget with $1.4 billion in new spending! Cash-strapped taxpayers can’t keep footing the bill.With ever increasing tax hikes on the horizon, many are already fleeing the state. That doesn’t bode well for New York’s future. Soon a smaller and smaller group of people will be asked to cough up more and more for the projects state leaders aren’t willing to let go of. This is clearly an unsustainable course.Please take action and urge your lawmakers to oppose this soda tax hike once and for all. Tax hikes stand in the way of New York’s prosperity and only continue to feed the growth of government. Now is the time to cut spending, waste, and the regulations that stand in the way of long-term growth.

From the “no surprises there” file comes State Representative Terese Berceau’s plan to raise Wisconsin’s beer tax. News like this just goes to show that once you start down the slippery slope of taxes and fees instead of pro-growth policies, there’s no stopping. Take Action and tell your leaders you oppose this tax hike scheme.FreedomWorks members from the Dairy State know that we’ve been actively opposing a cigarette tax hike and other fees that have been on the legislative table. In an email last month, FreedomWorks explained how that cigarette tax, which would make just the state taxes alone more than $2.52 per pack, wouldn’t begin to fill the budget holes. And that in fact, if high taxes were the path to prosperity then Wisconsin should be doing great!It’s clear that some in Madison haven’t gotten the message and are now piling on even more tax hikes. The latest plan is a beer tax that would raise the cost of a six-pack by 50 cents. That might not seem like a lot from a big desk in the capitol, but these days every penny counts. The beer tax is a perfect example of why FreedomWorks fights to oppose all tax hikes, even ones that you might think won’t affect you. That’s because without cutting spending and adjusting the state’s bottom line the money will never be enough. First, people will go across state lines, to the black market, the internet, and Indian Reservations to avoid the hefty tax. Second, others will simply go without - just because Wisconsin can’t stick to a budget doesn’t mean families don’t have to. And soon small businesses, the glue of our economy, as well as those working in the hospitality industry like servers and bartenders, will begin to feel the pain the most as business dwindles. Then before long, when the money doesn’t come rolling in, elected officials will start nosing around for the next thing to tax.It’s clear that tax hikes are something we should all oppose and we all need to vigilantly watch out for. You may not smoke. You may not drink beer. Still, one way or another, everyone will have to pay for the tax and spend decisions that are made at the state capital. Let’s try to stop these tax hikes once and for all. Please take action and tell your lawmakers you oppose this plan. Wisconsin needs to stop spending and roll back the regulations that stand in the way of real growth.

During a recession, the last thing government should do is raise taxes on the middle class and poor. But that is exactly what some Louisiana legislators are trying to do. They have crafted a 50 cent per pack tax hike on smokers that they say will raise more money for the state. But instead of raising taxes, legislators in Baton Rouge should find ways to cut wasteful government spending.Regardless of whether you smoke or not, all of us can agree that increasing taxes on the middle class and making it tougher for small businesses during a recession is bad public policy. Plus, the revenue that the government wants to collect won’t be there anyway, as recent studies have shown.Take a minute and SEND A MESSAGE to the legislature, telling them to stand on the principles of lower taxes, less government and more freedom by opposing the tobacco tax.

During the presidential campaign of 2008, Barack Obama pledged that those making below $250,000 would not see their taxes go up one dime. He promised to cut taxes for the middle class and poor people. But if his friends in Congress get their way, President Obama will have a tough decision to make – whether to break his campaign pledge again in the form of higher taxes on soda and “sugary drinks” like sports and energy drinks.

On behalf of hundreds of thousands of FreedomWorks members nationwide, I urge you to vote “No” on the Conference Report on S. Con. Res 13, the Obama-Pelosi-Reid budget. Their budget taxes too much, spends too much, and borrows too much. And, potentially worst of all, it would open the door for socialized medicine and a massive energy tax to be enacted later this year without substantial debate through the reconciliation process.No one voting for this budget—Democrat or Republican—will have any creditability in the future as a fiscal conservative.